Victoria’s budget reduction plan targets housing

More affordable housing needed outside city limits: council

The City of Victoria has established itself as a leader in affordable housing, but that commitment faltered a bit for the first time last week.

Council targeted its Housing Trust Fund as one of the first places it will look to cut in a large-scale review of city functions to find savings in the budget.

On Thursday, a slim majority of councillors voted to reduce the city’s annual contribution to affordable housing by $100,000, for a new total of $400,000.

For most on council, these tough times called for a tough decision.

“The vacancy rates have never been so high,” said Coun. Shellie Gudgeon, who voted in favour of the cut. “Given the economic climate, developers are looking to build rental housing. This is an opportunity to save some money and let the business sector fill in the gaps.”

For others on council, however, affordable housing represents an untouchable city priority.

“I don’t think it’s the right thing to do right now,” said Coun. Marianne Alto. “Resolving homelessness starts with housing first.”

Council did more than cut the housing budget. It also voted to shift more of its housing contributions to the Capital Regional District’s housing trust fund.

All municipalities in the region contribute to the CRD fund, but Victoria also has its own fund to encourage affordable housing projects within its own borders.

As part of the budget discussions, Coun. Charlayne Thornton-Joe questioned the logic of having this made-in-Victoria housing fund.

“If I’m a developer and I want to build affordable housing, I realize I can get money twice if I come to the City of Victoria because I can get money from the CRD and from the city,”  Thornton-Joe said.

For this reason, she said, most housing projects land in Victoria – and more specifically, they land in Burnside Gorge where the cost of housing is among the lowest in the city.

As a result, affordable housing projects are concentrated in one area of the city, Thornton-Joe said.

Council agreed, and voted to increase the contribution to the regional fund, which is used to support the development of housing projects anywhere in the region.

Mayor Dean Fortin opposed both decisions.

“Just because you shift money to CRD, doesn’t mean housing won’t show up in Victoria,” he said. “It depends on who’s willing to accept it.”

Fortin campaigned on a platform to alleviate Victoria’s severe shortage of affordable housing, and he also opposed the decision to cut the overall housing budget.

“The reason it is our priority (is) because it shows up here,” he said. “We do have to pay double duty here.”

The cut to housing isn’t a done deal. The city may launch some form of public engagement before making its final vote at a council meeting.

The ongoing financial savings discussions are for the city’s 2013 budget.

Proposed changes to housing budget

Decrease overall annual contributions to affordable housing from $500,000 to $400,000 by:

• Decreasing funding to the Victoria Housing Trust Fund from $250,000 to $50,000

• Increasing funding to the Capital Regional District Housing Trust Fund from $250,000 to $350,000.

rholmen@vicnews.com

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